Case Study $1$: CSR Project Gone Wrong

Jadec Consulting is a software firm operating in Rustenburg. They have been very

instrumental in helping mining companies with software solutions. Many mining firms in

the area largely depend on their software for mining operations. Jabulani Mkhize, the

owner, comes from an Information Technology background. He created many niche

solutions for mining firms. This enabled him to grow the company, to a point that there

were over fifty employees working for the company.

Over the years, Jadec Consulting had been contributing hugely to Corporate Social

Responsibility $($CSR$)$ projects, even funding students from high school to university. Some

of those students ended up working for the company. The impact they made to

communities encouraged them to do more bigger initiatives. The company decided to

embark on building a high school for the community in the Bapong township near

Rustenburg. They approached the community and its leaders. The community was

overjoyed with the idea. They pledged their full support for the project.

Jadec Consulting did not have experience in construction; therefore, they were going to

heavily rely on other consulting firms who were specialists in this area. Their procurement

department was tasked with the responsibility of finding suitable service providers for the

project. It was in April that year when the project was initiated. The expectation was that

by January, the following year, the school would commence. These were tight deadlines,

especially given the fact that they did not have depth of knowledge in such projects. Peter

Crox was appointed as the project manager for the initiative. Peter did not have the

requisite knowledge of running construction projects. He had been managing software

development projects for Jadec Consulting for years. However, management were

confident that he would work well with other professionals who will be appointed for the

project.

Peter Crox, together with the procurement manager, Lucy Calidz, and Portia Mpiya, the

quality manager, were convinced that they will be able to pull off the project, as

representatives of Jadec Consulting. The idea of the school was easy to conceptualise,

because it was going to be two blocks with $10$ classrooms each and two offices, but when

it came to the design and implementation, there was a lot to consider.

Their procurement process started by outlining the specifications for the school. The aim

was to use this information when going out on tender. When the specifications were

completed, they then advertised the tender. They developed the criteria for selecting the

best service provider. The tender was put up for a month, to allow service providers a

chance to prepare documents accordingly. Lucy recommended that they call a bidders$$

conference so that there could be further clarification to the service providers for the bid.

Peter and Portia were against the idea, they cited time constraints. They felt that since

these are subject matter experts, they would be able to understand what was required.

When the bids were returned, they selected the service provider based on the criteria.

Tersia Construction Projects $($TCP$)$ was the chosen company. John Pila was the project

manager from TCP$.$ He had plenty of civil engineering experience before he became the

project manager. Upon signing the contract, John asked to visit the site together with his

team.

To their surprise, they discovered that the site chosen had many rocks and therefore

blasting would be required, instead of normal excavation. This was going to affect the

construction of the foundation. They then requested more funds to do the blasting.

Fortunately, Peter had contingency reserves for such. The building of the foundation

started well. However, there were more claims coming from TCP because the provided

specifications were not appropriate for the project. There were many scope changes.

Management was getting more worried about the escalating costs and the fact that there

was a risk of not meeting the deadline. The community was also getting worried because

many had high hopes that their children would be placed at the school, the following year.

Based on the case study above:

List the issues

List the type of contract.and recommendations $,$ fixed priced, lump sum e$.$g

List standard form of contract and recommend $,$ NEC, fidic e$.$g